Research Study on Risks faced by Walmart - GRM Institute

Research Study on Risks faced by Walmart

Risks faced by Walmart

By  Srijani Bhattacharyya and Arul Dass (PGDRM Batch July’20-21)

 

 

Introduction
  • It is an American multinational retail corporation that operates a chain of hypermarkets, department stores, and grocery stores from the US, headquartered in Bentonville.​
  • Founded by Sam Walton in Arkansas in the year 1962​
  • As of April 30, 2021, Walmart has 10,526 stores and clubs in 24 countries, operating under 48 different names and operates in India as Flipkart.​
  • It is the world’s largest company by revenue, with $548.743 billion.​
  • Doug McMillion is the current CEO of Walmart.

 

Business Model

 

Structure of the Walmart Business Model

Walmart U.S.

  • It is the largest segment of the organization. That manages all the stores in the 50 states of the U.S., Washington D.C., and Puerto Rico. ​
  • This segment controls different aspects of the daily necessities of an individual.​
  • The business model of Walmart offers money orders, prepaid cards, wire transfers, and bill payments. ​
  • They provide physical access to the customers in the form of three primary store formats – supercenters, discount stores, and other small store formats.​

Walmart International

  • This part of the company includes 27 countries.​
  • The physical access is provided to the customers through the 156 distribution facilities.​
  • The physical stores support digital access with facilities such as “Click & Collect” (U.K.) and home delivery in Mexico.​

Sam’s Club

  • This segment operates in 44 states in the U.S. and Puerto Rico. ​
  • It takes care of membership-only warehouse clubs and provides a subscription service to individual customers as well as business owners.​
  • Focuses on Cross-docking.​

 

 

Strategies that led to the success of Walmart

  •  Walmart has two main strategies popularly known as EDLC and EDLP- EDLC- everyday Low Cost & EDLP- Everyday Low Price.​

 EDLP : Items priced at a low price every day so Walmart customers trust that its prices will not change under frequent promotional activity;​

EDLC : Effort to control expenses so that savings can be passed along to customers.​

  •  Rollbacks: Pass cost savings on to the customer by lowering prices on selected goods;​
  •  Online Grocery: Customer places grocery order online and has it delivered to home or picks it up at one of Walmart participating stores or remote locations; and​
  •  Money-Back Guarantee: Ensure the quality and freshness of the fruits and vegetables in Walmart stores by offering customers a 100 percent money-back guarantee if they are not satisfied.

 

Read the full research study here: Research study on Risks faced by Walmart

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